Vanguard funds are flattening the competition

Hamamatsu has a 90 percent global market share in photomultipliers, which look like lightbulbs. Sales to academic researchers represent only 5 percent of the total. The majority of revenue comes from medical and industrial applications. In X-ray machines, the multipliers check exposure time or dose. Pollution monitors employ them to observe the content of car exhaust fumes. They’re even used in drilling for oil wells to determine the density of rock.

President Hiruma, a graduate of Rutgers University, is taking the long view when it comes to increasing profitability. While many Japanese companies are cutting back investment, Hamamatsu is hunting for opportunities to increase returns via more capital spending. Hiruma says he’s interested in research on dark matter, a hitherto invisible part of the universe that he sees as a candidate for future Nobel prize-winning research. “We have this word in Hamamatsu, yaramaika,” he says. “It means ‘Let’s do it.’ It’s the spirit of just giving something a go. You can calculate the risk of doing something to some extent. But there’s also the risk of not getting future business opportunities if you don’t.”

The bottom line With 90 percent of the market for photomultipliers, Hamamatsu has earned a profit every year since it went public in 1996.